Which of the Following Is Not One of the Categories

question 30

Multiple Choice

Which of the following is not one of the categories of important financial ratios that are mentioned in the text to help assess an organization's overall financial situation?

• A) leverage ratios
• B) liquidity ratios
• C) asset management ratios
• D) activity ratios
• E) profitability ratios

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Definitions:

GAAP

A collection of commonly followed accounting rules and standards for financial reporting, used primarily in the United States.

Expense Recognition

Expense Recognition is an accounting principle that dictates the specific conditions under which expenses are recognized and reported in financial statements.

Revenue Recognition

The accounting principle dictating how and when revenue is recognized on the financial statements, ensuring it reflects the transfer of promised goods or services to customers.

Guaranteed Salvage Value

The minimum value for which an asset can be sold at the end of its useful life, as guaranteed by a contract or agreement.